Oct. 14: Talent acquisition job; non-QM, reverse, digital servicing, VOEI tools; 3-D printed houses: cure for storms & costs?
On this Columbus/Indigenous People's Day, welcome to the very first Commentary created by a 3-D printer. I bet that you can’t tell the difference! Yes, I am being sarcastic, as this Commentary was created by human keystrokes, but why haven’t 3-D printed houses taken off? Because builders who employ hard-to-find workers are not in favor of them? Because wood suppliers want to keep supplying wood? Kind of like the dock workers who strike because they don’t want automation to replace some of their jobs, here we have help for the lack of inventory in the U.S., but we don’t use it. What’s wrong with this picture? How about, in Florida, the first “net-zero” single-family home development in the US, meaning residents produce more energy from solar panels than they need, with the excess energy either being stored or sold back to the grid, made up of houses with sturdy concrete walls, hurricane-proof windows and doors are fortified with a layer of foam insulation. (There is no podcast due to the holiday, but this week’s is sponsored by Aidium. Aidium's CRM and Business Intelligence platform is the go-to system for lenders and enterprises serious about embracing technology to drive progress. Aidium boasts hundreds of integrations, a simple-to-use automation builder, reporting suite, and true AI for lead prioritization.)
Employment
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“Logan Finance is hiring a NQM TPO mortgage-focused Talent Acquisition Manager. We’re looking for a strong, strategic, and organized person to drive our recruiting efforts. Primary responsibilities of this role include developing and implementing Logan’s talent acquisition strategy, managing the recruitment process, identifying new sourcing methods, and maintaining a network of potential candidates. To apply, email us here. Logan’s Partner Plus Program is in full swing, providing many benefits to our brokers, including giving back over $300M in potential refi opportunities. The relationships we nurture and build with our brokers are very important to us and we seize any opportunity to help them grow their business. The Partner Plus Program is just one way we support brokers in their ongoing Non-QM success. Contact us today to hear how the Partner Plus Program can help expand your business.”
(As a reminder, anyone searching for employment can post their resume at no charge at www.lendernews.com, and potential employers can view all resumes for several months for only $75.)
Lender and broker software, services, and sponsored events
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The countdown is on: Just days left until VIBE 2024! Get ready to raise the stakes and roll the dice for your business at this week’s must-attend event. VIBE 2024 is your chance to gain a competitive edge and hit the jackpot in today’s market! Join Kind Lending’s Delfino “Del” Aguilar and top brokers like Ben Lemon, Eric Hines, Daniel Iskander, Thaun Nguyen, Jessica Bennett, and Tom Ahles as they reveal the winning strategies you NEED to thrive. Plus, industry titans Glenn Stearns, Grant Cardone, and Barry Habib will show you how to cultivate a winning mindset to elevate your business. And the best part? It’s completely free! Time is running out! Contact your Kind Account Executive for your registration code, or email Vibe2024@kindlending.com if you’re new to Kind Lending. Don’t miss your chance to win BIG this year!
Are you heading to MBA Annual 2024? Join Total Expert and Polly for an exclusive night of dazzling duets at Fortissimo Dueling Pianos. Enjoy complimentary craft beers, cocktails, snacks, and a one-of-a-kind performance by talented musicians. This is your chance to see two purpose-built solutions in one powerful combination, all while networking and reconnecting with lending leaders from around the country in a fun, laid-back setting. RSVP today to secure your spot at this can’t-miss event!
Costs for income & employment verifications have skyrocketed, ranging from $49 to $123 per request… And if there are two borrowers on the application, that price can easily hit $492. Just a few years ago, verifications were around $20, so the increase is being felt across the industry. But there's good news! Josh Byrom, SVP Technology & Innovation, Prosperity Home Mortgage, shares his experience working with Truv, a vendor partner that has helped reduce verification costs by as high as 90%. Hear Josh share his experience working with Truv here.
ICE is making servicing simple with MSP® Digital Experience, a brand new, intuitive user experience for the MSP® servicing system. MSP DX offers a conversational, chat-like interface to help turn the complexities of servicing work from “second language” into “second nature.” This makes it easier to navigate the robust capabilities and advanced automation that servicers have come to expect from the industry’s leading servicing platform. Plus, ICE is continually investing to deliver the latest cutting-edge solutions. Read about MSP DX here, and then stop by at MBA Annual to talk with ICE experts about how MSP DX can make servicing simple for your back office.
Correspondent & wholesale offerings
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Heading to Denver for MBA Annual? Come meet the Longbridge Executive Team! According to Home Mortgage Disclosure Act data, the mortgage industry left $200 million in net revenue behind in 2023. With a wealth of untapped home equity held by seniors, now is the time to stop leaving money on the table and explore the reverse mortgage market. Join Longbridge CEO Chris Mayer and our Executive Team at MBA to learn how you can diversify your business with reverse mortgages with our new game-changing initiative, A Blueprint for Reverse Mortgage Success. Whether you're new to reverse or looking to sharpen your strategies, we have the tools and support you need to excel in today’s competitive market. Set up a meeting at MBA with the Longbridge Financial, LLC (NMLS #957935) leadership team to learn more! Can’t make it to MBA? Contact Adrian Prieto, Longbridge SVP of Wholesale & Third-Party Relationships.
“It’s not just October, it’s JUMBOBERFEST at Carrington Mortgage Services, LLC. As part of our Non-Stop Non-QM savings, we’re waiving our underwriting fee on all Non-QM loans over $1M submitted in October. And that’s not all we have going on. We’re adding qualified Account Executives across the country. But wait, there’s even more! We’re attending NAMB this weekend in Las Vegas: Come see Amy Marsh and Sam Bjelac present on Non-QM. And if you come by our booth, you can spin The Wheel of Non-QM to win great savings for your borrowers. Contact Jeff Massotti to learn more. We will also be at the MBA in Denver and would love to connect to talk Correspondent lending. Please contact Kristi Larue to set up a private meeting. Be a part of JUMBOBERFEST today!”
Why aren’t alternative methods of home construction used?
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As my cat Myrtle used to suggest, there’re plenty of ways to skin a cat. Lumber and labor a problem? There’s 3-D printing. As one industry vet wrote to me, “There's really nothing new about concrete construction for homes. There's a lot of places where it's very common; Puerto Rico for example. Moreover, there's lots of different materials for homes. I live in a stone house, there’s rammed earth and moisture-proof straw bales. Modular homes manufactured homes are often made of various composite materials plastics and steel. Brick is common in a lot of places and stucco. I don't think it's about the material.
“The construction style and process are what's new. And the lending impact is that homes need to be common in customary for the area in order to meet various lending guidelines so if you're the first 3-D printed house in your neighborhood, it's going to be difficult to obtain financing that is eligible for the GSEs or the government programs. So financing is tricky for a little while until it becomes a common practice. So, there's a bit of a ‘penguin in the water’ thing.”
AXIS AMC CEO Michael Simmons asked, “At what point in time do we begin to take what we’ve learned: that 3-D printed houses can withstand many of nature’s forces (floods, hurricanes, fire) that our current building protocols just can’t protect against? We create rules and regulations around damned near everything, but we can’t find a way to protect our fellow citizens by offering a housing solution that has the capacity to be ultimately safer and more affordable for many environs. Why I’ll bet that, with a little encouragement, we’d find that those 3-D dwellings could shed the appearance of a military bunker and be made attractive and distinctive. For the other end of the spectrum, look no further than designer/builder Tadao Ando’s concrete home in Malibu, CA… Except that little place was a 40,000 square foot compound that sold for $200 million!
“Three years ago they broke ground on a subdivision of 3-D printed homes that were built in Texas. Lyle Radke, Fannie’s Sr Director of Collateral Policy (aka, Chief Appraiser), was telling me that Fannie was following it to see what the market acceptance level was. I have to think there’s more going on out there that we’re not seeing or hearing about but you may be right about the embedded forces aligned against the initiative. In hindsight, I guess I’m surprised that there’s no large investor forces that have emerged to support this… or there are real problems of scaling?
Mike’s note continued, “Imagine the use cases. Sound and stable housing in countries where there are no real resources for wood-built structures. Where people could have stability and safety. A home to raise and protect a family. It’s happening all over. Ingenuity and resourcefulness are at work; rammed earth homes, dwellings made from sod, re-cycled tires and plastic bottles, straw bales corn cobs (yes – corn cobs) … The world is an amazing place.
We need to celebrate and encourage these opportunities for change. Well, maybe except for Face Book, and Elon Musk, and the incessant yammering about AI…”
Jeremy Potter thought, “I think it's a worthwhile challenge to readers to think about it. Also, I think what you wrote about people misunderstanding concrete versus wood is right. On the point of workers, the best part of 3-D printing is that you essentially need ‘monitors’ for the printer rather than skilled trades. Creates jobs and lowers cost. But the printers are on-site 24/7 and typically do require security or monitors while printing overnight BUT they can move faster because you can essentially do 3 shifts of humans at a lower cost than 1 onsite stick-built crew.
“The one reason I've seen to explain slow adoption is that 3-D printing does not have a solve for roofs; At this point its foundations and frames. Even in the video you can see that he says, ‘roof system added’ which is fancy way of saying ‘we can't do the roof.’ Not sure if you want to address some possible explanations for slow adoption curve but I think that's one possible reason.”
Capital markets: markets are closed so watch pricing
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Both the stock and bond markets have had their eye on Middle East escalation concerns, a hotter-than-anticipated consumer inflation report, and a recalibration of Federal Reserve interest rate cut expectations. Sure enough, stock markets have continued to march higher while bond prices have fallen, raising rates. Some of it can be chalked up to favorable reactions to quarterly results from big banks, but the story last week has largely been traders' resilience to negative developments.
The Federal Reserve published the minutes of its September monetary policy committee meeting on Wednesday, especially important since it was a meeting where the central bank delivered a half-point interest rate cut to kick off an easing cycle for the first time since the COVID-19 pandemic. The minutes showed that a "substantial majority" of policymakers backed the big 50 basis point cut.
Inflation, which has been the focus of the markets and the Fed in the last few years, grabbed all the attention on Thursday and Friday. On Thursday, the consumer price index for September came in hotter than anticipated on an M/M basis for both the headline and core figures. On Friday, the producer price index figures came in cooler than expected. LOs should know that not all of the price moves at the producer level are passed on to the consumer, at least immediately.
When the U.S. bond market, which includes trading in securities backed by mortgages, is closed, but lenders are open and taking locks, ask your capital markets staff how they price. Some check overseas rate markets. Others add in a sizable cushion in pricing margins to discourage locks. Some hedge their expected lock volume on Friday to cover today’s locks. Some do a combination of all of the above.
The bond markets are closed today for Columbus Day, but return tomorrow, and this week’s highlights include updates on Fed surveys, import prices, retail sales, capacity utilization / industrial production, business inventories and housing data. Treasury supply is limited to T-bills, and there are more Fed speakers. Outside of the Fed, the European Central Bank will be out with its latest monetary policy decision on Thursday where another 25-basis points cut is nearly fully priced. For MBS, Class B and C 48-hours are tomorrow and Thursday, respectively. The 10-year closed Friday yielding 4.10, so we’ll see what happens tomorrow.
After having dug to a depth of 10 feet last year outside of Buffalo, New York, scientists found traces of copper cable dating back 120 years. They came to the conclusion that their ancestors already had a telephone network more than 100 years ago.
Not to be outdone by the New Yorkers, in the weeks that followed, a Wheeling West Virginia archaeologist dug to a depth of 20 feet somewhere just outside Woodsdale. Shortly after, a story in The Intelligencer read, "WV archaeologists, reporting a finding of 200-year-old copper cable, have concluded that their ancestors already had an advanced high-tech communications network a hundred years earlier than the New Yorkers."
One week later, a local newspaper in Twinsburg, Ohio, reported the following. "After digging down about 30 feet deep in his pasture between the Twinsburg Public Library and the Wastewater Treatment Plant, Pete Riley, a hell of an engineer and a self-taught archaeologist and sommelier, reported that he found absolutely nothing. Riley has therefore concluded that 300 years ago, "Ohio had already gone wireless."
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(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2024 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman. The views and opinions in this newsletter are mine alone unless otherwise specifically stated herein.)